Gift Card Distribution: Maximize Your Program Beyond Physical Retail
By TDS Gift Cards
Global gift card programs are increasing in complexity (alternative formats, payment flows, economic models, technology partners, user experience, etc). The sheer number of gift card brands in the marketplace has dramatically heightened the level of competition for retailer and consumer mindshare. Putting yourself in the place of a consumer, you can imagine how overwhelmed they may be standing in front of the large in-store retail gift card mall displays. Hundreds of choices means that your brand may be easily missed depending on placement and a host of other factors.
Similar to marketing, all brands should be considering alternative forms of distribution beyond physical retail. The options are evolving and changing based on the needs of the consumer. The TDS platform provides brands instant access to virtually every gift card distribution opportunity both physically and digitally that is available globally, regardless of activator. Beyond point of sale activation cards (POSA), TDS can offer pin-on-receipt, CHIT cards, business-to-business, loyalty/rewards programs, lan houses, bulk order programs, e-gifting, kiosks, ATMs, banking apps, and promotional codes.
Solving Payment Challenges
All of these options can seem overwhelming for any brand. TDS helps brands negotiate & leverage the potential of gift cards and codes to solve payment and customer acquisition challenges in 60+ countries.
TDS helps our partners weed through these channels to determine which ones would be most advantageous to pursue. Additionally, TDS outlines which distribution opportunities are important and viable by country/region. For example, in certain countries offering pin-on-receipt is even more important than offering POSA cards in physical retail.
Here are a few of the most asked about alternative distribution channels and how they may be of value to your business.
Pin on Receipt Enabled Gift Card Distribution
Pin on Receipt (PoR) is a method of code distribution which does not require physical gift cards. The code is printed on a receipt after the customer has made their purchase at a retailer’s till/register/kiosk/ATM. PoR has served as a successful self-use payment method, primarily for the mobile industry, for several years and is most common in cash-based markets.
PoR networks typically cover a collection of small independent retailers (convenience, mom & pop, etc.). Countries with PoR networks typically see locations aggregated into 2-3 networks covering 5k – 150k locations. Consumer experience can be self-serve (kiosk positioned near checkout) and full-serve (cashier manages via register/till).
Most prominent markets for PoR include: LatAm, SEA, Japan, Southern Europe, Middle East, and South Africa. There are limited options in the US & Canada for PoR as those markets are very strong on gift giving and most people are banked customers.
There are many benefits to distributing codes via PoR. The average lead-time for launching a PoR program is 4-6 weeks whereas launching POSA takes roughly 16-24 weeks. Economics are also improved for PoR versus POSA as there are no card costs, no slotting fees and PoR typically has a lower margin. Additionally, PoR allows the ability to offer various price points to consumers without fighting for peg space. Brands can also choose to test a launch in new markets by utilizing PoR with lower risk. Lastly, PoR is many times a preferred payment option for cash-based consumers.
While there are many advantages to PoR, there are also downsides. The most prominent being the marketing that is required to make customers aware of this method of gift card distribution. In order to create awareness you must commit to some marketing element offered by the retailer, whether that be posters, window clings, wobblers, register displays, etc. and those merchants can have so many marketing opportunities available that you are competing for consumer attention.
Loyalty/Rewards Programs
Loyalty and rewards programs are managed by banks, airlines, service companies and other fintech entities. They partner with corporations and other brands looking to generate loyalty with their consumers and/or reward their employees. Gift cards are a big part of these programs as they are a sought after reward and loyalty builder.
These programs can be mainly supported by digital e-gift offerings, but physical gift cards are sometimes made available depending on the opportunity.
TDS has partnered with all leading card/code distributors, making the implementation of a global loyalty/rewards program streamlined and reducing the burden on a client’s engineering teams. We partner with over 70 of today’s leading companies.
B2B and Bulk Gift Card Distribution
B2B represents a significant portion of the gift card market – making up over 23% of the $125.4B industry and representing nearly $30B, according to the RGCA. The two halves of the B2B market are consumer incentives, which consist of the previously mentioned rewards and loyalty programs, and employee incentives. Employee incentives are typically fulfilled through bulk purchases. Those orders are typically distributed in two different ways, either through a secure file with gift card codes to be delivered by the purchaser or individual codes emailed to each of the recipients.
One unique benefit to this form of distribution is an increase in new customers. If a business distributes bulk gift cards to its employees, there are likely going to be recipients who were not previously
customers of the company. The increased brand awareness is a significant difference from other individual distribution methods. TDS offers hosting branded bulk purchasing portals for our partners, allowing our partners to have a platform to fulfill bulk and B2B purchases. These portals offer a streamlined solution for corporate partners while being simple, customizable, and trackable.
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Ready to expand your gift card program distribution beyond physical in-store retail? Drop us a line at info@tdsgiftcards.com
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